RBS 2009 Annual Report Download - page 365

Additional information
363RBS Group Annual Report and Accounts 2009
Total capital expenditure on premises (excluding investment properties),
computers and other equipment in the year ended 31 December 2009
was £1,215 million (2008 – £1,406 million; 2007 – £1,792 million).
Major shareholders
Details of major shareholders of the company’s ordinary, B and
preference shares are given on page 213.
In December 2008, The Solicitor for the Affairs of Her Majesty’s Treasury
(HM Treasury) acquired 22,854 million ordinary shares representing
57.92% of the company’s issued ordinary share capital. During 2009,
HM Treasury acquired a further 16,791 million ordinary shares raising
their holding to 70.3% of the company’s issued ordinary share capital.
In December 2009, HM Treasury acquired 51 billion B shares in the
company representing the entire issued B share capital.
Other than detailed above, there have been no significant changes in
the percentage ownership of major shareholders of the company’s
ordinary, B and preference shares during the three years ended
24 February 2010. All shareholders within a class of the company’s
shares have the same voting rights.
At 24 February 2010, the directors of the company had options to
purchase a total of 12,138,546 ordinary shares of the company.
As at 31 December 2009, almost all of the company’s US$ denominated
preference shares and American Depository Shares representing
ordinary shares were held by shareholders registered in the US. All
other shares were predominantly held by shareholders registered
outside the US.
Material contracts
The company and its subsidiaries are party to various contracts in the
ordinary course of business. Material contracts include the following:
Consortium and Shareholders Agreement (CSA)
On 28 May 2007, Fortis Bank Nederland, the company, Santander and
RFS Holdings entered into the CSA. Fortis Bank Nederland acceded to
the CSA on 26 July 2007. On 3 October 2008, the Dutch State acquired
Fortis Bank Nederland. On 24 December 2008 the Dutch State acceded
to the CSA following its acquisition of the shares held by Fortis Bank
Nederland in RFS Holdings pursuant to a Deed of Accession entered
into between RFS Holdings, the company, Fortis Bank Nederland,
Santander and the Dutch State. The CSA governs the relationships
amongst the parties thereto in relation to the acquisition by RFS
Holdings of ABN AMRO. The CSA details, inter alia, the funding of RFS
Holdings in connection with the acquisition of ABN AMRO, the equity
interests in RFS Holdings, the governance of RFS Holdings both before
and after the acquisition of ABN AMRO, the arrangements for the
transfer of certain ABN AMRO businesses, assets and liabilities to the
Dutch State (previously Fortis Bank Nederland), the company and
Santander post-acquisition of ABN AMRO, further funding obligations of
the Dutch State, the company and Santander after the acquisition of
ABN AMRO where funding is required by regulatory authorities in
connection with the ABN AMRO businesses, the allocation of Core Tier
1 capital and the allocation of taxes and conduct of tax affairs.
Underwriting Agreement
On 22 April 2008, the company, Goldman Sachs International, Merrill
Lynch International, UBS and the Royal Bank entered into an
underwriting agreement, pursuant to which Merrill Lynch International,
Goldman Sachs International and UBS agreed to procure subscribers
for, or failing which themselves to subscribe for, ordinary shares not
taken up under the Rights Issue, in each case at the relevant issue
price. Pursuant to the underwriting agreement, the company agreed to
pay certain fees and expenses to Merrill Lynch International, Goldman
Sachs International and UBS in consideration for their underwriting
commitment. The company gave certain representations and warranties
and indemnities to those persons defined as underwriters in the
Underwriting Agreement. The liabilities of the company were uncapped
as to time and amount.
Sale of Angel Trains
On 6 August 2008, the company completed the sale of Angel Trains
Group to a consortium advised by Babcock & Brown for an enterprise
value of £3.6 billion.
Sale of Tesco Personal Finance
On 28 July 2008, the company announced that it had agreed to sell its
50 per cent. shareholding in Tesco Personal Finance to its joint venture
partner Tesco plc for a cash consideration of £950 million, subject to
transaction adjustments. As part of this transaction, the company
agreed to continue to provide certain commercial services to Tesco
Personal Finance post-completion. The sale completed on 19 December
2008.
First Placing and Open Offer Agreement
Pursuant to a placing and open offer agreement effective as of
13 October 2008 entered into between the company, UBS, Merrill Lynch
International and HM Treasury, (i) the company agreed to invite
qualifying shareholders to apply to acquire new shares at the issue
price of 65.5 pence by way of the First Open Offer, (ii) UBS and Merrill
Lynch International were appointed as joint sponsors, joint bookrunners
and joint placing agents and agreed to use reasonable endeavours to
procure placees to acquire the new shares at not less than the issue
price of 65.5 pence on such terms as agreed by HM Treasury on the
basis that the new shares placed were subject to clawback to the extent
they were taken up under the First Open Offer and (iii) HM Treasury
agreed that, to the extent not placed or taken up under the First Open
Offer and subject to the terms and conditions set out in the First Placing
and Open Offer Agreement, HM Treasury would acquire such new
shares itself at the issue price of 65.5 pence.
In consideration of its services under the First Placing and Open Offer
Agreement, HM Treasury was paid (i) a commission of 0.5 per cent. of
the aggregate value of the new shares at the issue price of 65.5 pence
per new share payable on Admission (as defined in the First Placing
and Open Offer Agreement) and the second business day after the day
on which the First Placing and Open Offer Agreement terminated and
(ii) a further commission of 1 per cent. of the aggregate value of the
new shares acquired by placees (including HM Treasury) at the issue
price of 65.5 pence per new share payable on Admission (as defined in
the First Placing and Open Offer Agreement). The company paid all
legal and other costs and expenses of HM Treasury, those of UBS and
Merrill Lynch International properly incurred and the costs and
expenses of HM Treasury’s financial advisers incurred in connection
with the First Placing and Open Offer and the preference share issue.